CCJ resolves family battle

Fri, Jun 13, 2014

The Caribbean Court of Justice continues to demonstrate that it is here to serve the people of the region even in instances where families have been unable to resolve their own conflicts. One such instance is seen in the Guyanese case of Aslim Sheermohamed v Azeez Sheermohammed [2011] CCJ 8 (AJ).{{more}}

This case concerns the attempt of members of a family to gain control of the family company, S.A. Nabi & Sons Limited. In November 2004, Aslim, the Appellant, brought legal action against his brother Azeez and his nephew Affron, following their appointment as directors of the family company in a meeting convened by his brother, Amin. This meeting was held the day after Aslim declared that his son, Ashmin, was the elected director of the company. Consequently, Aslim challenged the validity of Amin’s meeting and the decisions that flowed from it.

The High Court judge deciding the matter was required to give effect to section 135(5) of the Companies Act. This section provides that where a shareholder has requested the directors of a company to convene a meeting and the directors fail to do so within 21 days of the request and to hold the meeting within 28 days of convening it, that shareholder may himself convene a meeting of the shareholders. The judge considered that Amin served a request on the directors of the company, but he proceeded to convene his meeting before the expiration of the 21 days. As a result, the judge found, the meeting was unlawful and invalid and Affron’s and Azeez’s appointments were invalid. The Court of Appeal, however, found that the premature convening of the meeting did not invalidate the appointments, as the directors eventually did not convene the meeting at all. Unhappy with the Court of Appeal’s decision, Aslim appealed to the CCJ.

The Court carefully evaluated the provisions of section 135 of the Companies Act, noted the policy considerations applicable and then declared the correct interpretation and application of the section in the present case. It found that Amin’s meeting was invalid, as it was convened prematurely, regardless of the omission of the directors to act in the end. The order of the High Court judge was reinstated and the Court ultimately resolved the family dispute.